Assessing M&A Advice

October 22nd, 2018

How would you know your Corporate Finance Adviser is making progress or success with selling your business or raising money if you have no metrics in place? The answer of course is you won’t, it is all conjecture (cobbling together loose assumptions of interest) until you pass the winning post. Here is the counter-intuitive point, the onus is on the entrepreneur or founder to agree them BEFORE approving the Adviser’s proposal or making the initial payment.

What should they contain? Let’s keep it simple, focus on hard evidence and observed behaviour. Here is a quick primer. 

  1. Attracting buyers or capital sources. Are our target lists increasingly stocked with “ideal buyers or capital partners” or a largely undifferentiated group of candidates? That assumes you have first developed a clear and specific picture of what ideal looks like, sounds like, and acts like (traits). Are we definitively providing valuable insights, ideas, and information to them in a timely manner? Are we highly organised such that our week is increasingly filled with in-person meetings with our ideal buyers and capital partners in various environments? (one-to-one, networking events, public speaking, hosted events)   
  2. Converting interest to firm commitment. Targets must become bidders or investors bringing firm offers. Are you increasingly seeing responses that validate the tremendous return on investment, the pragmatic value you are offering, and a peer-level trusting relationship, resulting in agreements to present a proposal? Is there demonstrable momentum in the quality and quantity of those proposals leading to firm offers, in a timely manner? 
  3. Firm commitments to an agreed preferred option.  Are you able to preserve the critical and highly important points (valuation, mix and timing of proceeds, future roles etc)  while compromising on moderate or low important issues with your buyer or capital partner? Are you able to resolve conflicts over outcomes or alternatives quickly and with minimal impact on your relationships? Do your advisers have preventative and contingent actions in place for an agreed offer (failure to raise financing in a timely manner, backup plan if deal collapses at a late stage and so on)?
  4. Implementation of the deal. Are your adviser’s meeting or exceeding your expectations with clear metrics for the strategic fit, ease of implementation, benefits and cost impact on your business? Are they meeting or exceeding your personal priorities (financial, non-financial, peace of mind, time use and so on)?  
  5. Growth. During the engagement are your adviser’s creating new value for you in return for additional remuneration? For example, this might be new businesses opportunities outside of the immediate deal, where you are selling and exiting your business entirely, repeat opportunities for fresh investment at the next stage of the firm’s growth or referrals to people of mutual interest (private bankers, investors, entrepreneurs, social or philanthropic connections). 

Focus your assessment on these five areas and the ease with which you progress. Keep it simple. 

With any initiative and adviser, where is your “process” today?  

Technology: Friend or Foe

August 21st, 2018

When you blindly see technology as an “end” in of itself, not a “means” to a more impressive client experience, greater productivity, reduced risk and so on, you self-limit your own power and control. Think about that for a minute. 

Phone Dependency

November 12th, 2018

If you are feeling compelled to “sit” on your phone while in the middle of family time, at dinner, at the theatre or the sports event, you ARE the problem. Not your boss, not your client, no you. 

Building Trust

November 12th, 2018

When you rush to “sign up” a prospect as a client, an adviser, an investor and so on, counterintuitively you lessen the prospects of profitable business. Why? This is the relationship business. Foregoing time taken to properly build a trusting relationship gnaws away at the benefit of doubt the other party gives you, their accuracy in helping you make smart decisions and their commitment to help you prosper (reciprocity). Take a pause, invest quality time and keep offering reciprocal value. 

When Everyone is a PR

November 5th, 2018

Productive Content

I walked into a countryside pub recently and I saw a guy attempting to play darts, missing the entirety of the dartboard frequently, endangering bystanders and very irregularly hitting the required number. My first thought was “give yourself a break, get a new hobby”.  It reminded me of countless number of people daily posting their musings on LinkedIn, Facebook or Twitter or issuing press releases, articles, and self-authored content. Aimless content disappearing into the ether of self-congratulatory irrelevance. Time really is precious.

If you want to “play”, be very sure who your target audience is (specific traits), aim where they demonstrably hang out and engage with others (publishing forums), and be clear what response you want to elicit (provocation, engagement, seen as a peer or thought leader). I am not suggesting you keep score of every piece of your content’s impact (futile activity), what I am suggesting is you ask yourself is this time well-spent given my immediate priorities? Be honest.

Title

October 31st, 2018

If you ever wanted to confuse someone’s title with talent and judgement take a look at Woody Johnson, US Ambassador to London. Watching a British fly-on-the-wall documentary “Inside the US Embassy”, the heridetary billionaire is pictured so far out of his depth on complex issues and surrounded by people of questionable ability. Who puts someone in this position?

Excuse Me

October 31st, 2018

I am standing at a cocktail event in the Irish Embassy talking to various tech entrepreneurs and investors. To my right marches up “Alan”, a sixty year old silver haired man offering canapés on a silver salver. When we are done, he insists on scattering us when he marches between us to his next “prey”. I don’t presume at first there is anything untoward until he does the exact same thing four subsequent times during the night.

It is easy to presume in business someone is “damaged” when we experience a bad first impression. We are wrong to jump to conclusions about a single instance. How do I know he wasn’t tired, poorly trained or distracted momentarily? What we need to zero in on are patterns of reckless or bad behaviour and the probable cause.

To have the courage to confront it, if it is serious enough, and to let it go, if it is a minor irritant. Too often I witness people, who cannot remove the emotion from their judgement, screaming at ticket attendants or absolving slovenly behaviour when addressing their clients. Let’s move on.

Entrepreneur’s Legacy

October 29th, 2018

It is not what wealth you acquire that matters (Sir Philip Green), it is how you contribute to the world we live in (Vichai Srivaddhanaprabha).

Sell-Side Wealth

October 29th, 2018

I meet a great many entrepreneurs/founders in their later years embarking on ambitious ownership transitions. In my experience with such complex and ambiguous plans, we need to ensure the strategic guidance to successfully attract ideal investor(s) and convert that into a signed agreement is matched by the seller’s future understanding of their actual personal wealth needs, post-sale. The trail is littered with the remains of unrealistic and poorly informed sellers of businesses that pursued a sale without sound metrics and accountabilities. 

  1. What do you actually need financially to live in your desired lifestyle for the rest of your life?
  2. Is it realistic and supported by hard evidence?

If “Yes”, where are you today, what changes must happen, who is accountable, and in what timeframe?

If “No”, when and where are you going to acquire the hard evidence and the expertise, to help you make prudent life changes consistent with your realistic financial means? 

It is that simple if you have the courage and volition to put yourself first. 

Entrepreneur Blindspots

October 28th, 2018

Who get’s my time and interest? Two exploratory conversations with contrasting entrepreneurs with high-growth businesses this week. 

Entrepreneur A: “Let me show you my powerpoint presentation.” Five minutes later in response to what are you seeking to accomplish and where might I be immediately helpful, “I am just looking for money, I don’t need anything else.”

Entrepreneur B: “Let me tell you where I am at with my business, where I’d ideally like to be in future and what I am needing to change including raising new money.” After ten minutes of discourse and accepted vulnerability, “I’d be interested in your advice for me.”

As investors we want confident, not humble entrepreneurs. We want entrepreneurs with high levels of self-worth and a willingness to be vulnerable. To voluntarily admit weakness and display smart judgement.

We don’t want defensive entrepreneurs or those, who seek to excessively control our view into their business. Entrepreneurs don’t have to be transparent, translucent will do fine. When your use of powerful language, social skills, and intellect is obscured from us, little wonder investors move on.  

Here is my observation: have you adapted your behaviour to the life you now lead (entrepreneur), or insist on behaving as you learned to do in a former life as a former Citi banker, BCG consultant or CEO of a global company? 85% of the first-time entrepreneurs I meet persist in behaving as they have in their prior life with one obvious exception. Money. They happily claim poverty “I am not in the position I was….” at the mere mention of paying for advice. When the reality is they remain in the top 2% of the nation’s wealthiest people.  It is simply not credible. 

Power Abusing Power

October 26th, 2018

Am I alone in thinking that when a senior politician seeks to exert their “parliamentary privilege”, it says more about exerting their ego than their principles? This week we have another high-profile legal process (Sir Philip Green) usurped by a British politician (Lord Hain). In the court of public opinion fanned by the media, the defendant is guilty until proven right. Why? Bad news, whether factual or not, sells papers. Irrespective of the legal resolution, his reputation is trashed. That cannot be fair and the foundation of a healthy democracy.  

Co-working Backlash

October 24th, 2018


The rise of co-working we are told (WeWork to boutique offerings) is a trend that won’t stop in major financial centres and beyond. Demand for the traditionally designed office space is on an never-ending decline.

Have you have ever tried to have a confidential call in a public co-working space or undisturbed time to think? It is a constant attack on the senses.

Here is but three examples: John, the twentysomething facilities management salesman, who insists on telling Jo, his client at Selfridges how he pulled “a rough bird last night” while picking his nose… Sue, the “amateur” recruitment consultant, who asks her unwitting interviewee “tell me why did your boss let you go at Axa?”… Judith, the bespectacled marketing consultant, who insists on warming her Thai fish curry in the kitchen’s microwave, filling the last gasp of oxygen in the entire public space and blankly staring into a backlit screen.

If you haven’t seen this you are missing a treat. 

I have not been in one “open” space, WeWork included, where the building operator and designer has truly figured out the sentient experience, in a hundred plus visits to different brands across the globe.

We are putting up with it, in a way we “live” with low-cost airlines or Luton Airport, accepting hardship in return for lower costs and greater flexibility. Can you really see sustainable growth for these businesses without better design that addresses basic human needs (greater privacy, minimum disturbance, and a more pleasant working environment)? I cannot.